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2021 (1) TMI 972 - AAAR - GSTClassification - taxability - provision of hostel accommodation along with food facility to the students wherein consolidated amount is charged from the students - composite supply or principal supply - recovery of entire charge from the students - exemption from GST under Sr. No. 14 of the CGST (Rate) Notification No. 12/2017 dated 28.06.2017 as amended if the charges per day is less than ₹ 1000/- - taxability on supply of hostel accommodation along with food facility - CBEC Flyer No. 40 dated 01.01.2018. HELD THAT:- In the instant case the appellant is supplying various services like supply of food, TV in dining hall, Playroom, Gym, Housekeeping of entire hostel premises, Room cleaning and Washing/ dry-cleaning of bed sheets & linen of rooms along with Hostel Accommodation service. The supply of various other services as detailed above with Hostel Accommodation service is not naturally bundled in normal course of business. Each service is an independent service and can be supplied separately. It is obvious that a person can live on the hostel without availing other services like food, TV, gym, etc; but to make ones stay more comfortable, the said ancillary services are availed by him - Rajasthan Authority’ of Advance Ruling has held that naturally bundled services are those services wherein one of the services is the main service and the other services combined with such service are in the nature of incidental or ancillary services which help in better enjoyment of a main service. If current nature of supply of services is tested based on above factors, it can be ascertained that the provision of hostel accommodation could be a principal supply but ancillary services like food, gym, housekeeping, play room, cannot be said to arise naturally with the principal service of hostel accommodation and therefore are not bundied naturally with principal supply. Rajasthan Authority of Advance Ruling has placed reliance on the ruling of West Bengal Authority for Advance Ruling in the case of Sarj Educational Centre [2019 (2) TMI 1605 - AUTHORITY FOR ADVANCE RULING, WEST BENGAL] involving similar facts and circumstances, wherein the applicant was engaged in supplying food and other services, etc and it was held that they are not naturally bundled with the lodging service. All these components are independent of each other. The said ruling has been upheld by the Appellate Authority of Advance Ruling of West Bengal. There are no infirmity in the Advance Ruling pronounced by Rajasthan Authority of Advance Ruling - the Advance Ruling pronounced by the Rajasthan Authority of Advance Ruling upheld - appeal dismissed.
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